Cunningham v. Lyft, Inc.

17 F.4th 244
CourtCourt of Appeals for the First Circuit
DecidedNovember 5, 2021
Docket20-1373P
StatusPublished
Cited by17 cases

This text of 17 F.4th 244 (Cunningham v. Lyft, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the First Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cunningham v. Lyft, Inc., 17 F.4th 244 (1st Cir. 2021).

Opinion

United States Court of Appeals For the First Circuit

Nos. 20-1373, 20-1379

MELODY CUNNINGHAM, individually and on behalf of all others similarly situated; FRUNWI MANCHO, individually and on behalf of all others similarly situated,

Plaintiffs, Appellees/Cross-Appellants,

MARTIN EL KOUSSA, individually and on behalf of all others similarly situated; VLADIMIR LEONIDAS, individually and on behalf of all others similarly situated,

Plaintiffs,

v.

LYFT, INC.; LOGAN GREEN; JOHN ZIMMER,

Defendants, Appellants/Cross-Appellees.

Nos. 20-1544, 20-1549, 20-1567

MELODY CUNNINGHAM, individually and on behalf of all others similarly situated; FRUNWI MANCHO, individually and on behalf of all others similarly situated; MARTIN EL KOUSSA, individually and on behalf of all others similarly situated; VLADIMIR LEONIDAS, individually and on behalf of all others similarly situated,

Defendants, Appellants/Cross-Appellees. APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS

[Hon. Indira Talwani, U.S. District Judge]

Before

Lynch and Kayatta, Circuit Judges, and McElroy,* District Judge.

Elaine J. Goldenberg, with whom Jeffrey Y. Wu, Benjamin G. Barokh, Donald B. Verrilli, Jr., Rachel G. Miller-Ziegler, Rohit K. Singla, Justin P. Raphael, Adele M. El-Khouri, Munger, Tolles & Olson LLP, James D. Smeallie, David J. Santeusanio, Andrew E. Silvia, Michael T. Maroney, and Holland & Knight LLP were on brief for appellants. Ben Robbins and Martin J. Newhouse on brief for New England Legal Foundation, amicus curiae. Steven P. Lehotsky, U.S. Chamber Litigation Center, Inc., Archis A. Parasharami, and Mayer Brown LLP on brief for Chamber of Commerce of the United States of America, amicus curiae. Shannon Liss-Riordan, with whom Anastasia Doherty, Adelaide H. Pagano, Anne R. Kramer, and Lichten & Liss-Riordan, P.C. were on brief for appellees. Hugh Baran on brief for National Employment Law Project, Massachusetts Coalition for Occupational Safety and Health, Justice at Work, and New York Taxi Workers Alliance, amici curiae.

November 5, 2021

* Of the District of Rhode Island, sitting by designation. KAYATTA, Circuit Judge. Plaintiffs are Massachusetts-

based rideshare drivers who use the Lyft application and platform

to find passengers. Plaintiffs claim that Lyft misclassifies them

as independent contractors, rather than employees. They seek

relief on their own behalf and on behalf of other drivers who

worked for Lyft in Massachusetts, although a class has not been

certified.

The parties joined issue in a flurry of motions leading

to rulings concerning plaintiffs' requests for preliminary

injunctive relief and Lyft's request to compel arbitration. Lyft

now presses an interlocutory appeal from the denial of its motion

to compel arbitration, while plaintiffs press interlocutory cross-

appeals from the denial of requests for preliminary injunctive

relief, including a so-called "public injunction."1 For the

following reasons, we reverse the order denying Lyft's motion to

compel arbitration, and affirm the denials of preliminary

injunctive relief.

I.

Lyft, Inc., a ridesharing company, uses a smartphone

application to allow customers to hail drivers. Cunningham v.

Lyft, 450 F. Supp. 3d 37, 39 (D. Mass. 2020). In order to work

1Lyft also appealed the order denying the "public injunction" request, to preserve the argument that the order should be vacated for lack of jurisdiction due to the pendency of Lyft's earlier appeal.

- 3 - for Lyft as a driver, "an individual must register, download the

application, and agree to Lyft's Terms of Service." Id. The Terms

of Service spell out how a driver qualifies to use the platform to

connect with riders and how fares are set, collected, and

apportioned. See Cunningham v. Lyft, No. 1:19-cv-11974-IT, 2020

WL 2616302, at *6 (D. Mass. May 22, 2020).

Lyft considers its drivers "independent contractors" and

does not provide them with sick leave benefits. Id. Although

drivers may drive as much or as little as they want, and may also

reject ride requests, Lyft retains the right to deactivate drivers

who violate the Terms of Service or fall below Lyft's "star rating

or cancellation threshold." Id.

In 2018, Lyft updated its Terms of Service. Drivers

could not continue using Lyft to pick up riders until they signaled

their acceptance of the updated Terms of Service by clicking the

"I accept" button. Cunningham, 450 F. Supp. 3d at 39. Those

revised terms stated, in relevant part, that "[t]hese provisions

will, with limited exception, require you to submit claims you

have against Lyft to binding and final arbitration on an individual

basis, not as a plaintiff or class member . . . As a driver or

driver applicant, you have an opportunity to opt out of arbitration

with respect to certain claims." Id. at 39–40 (capitalization

altered). Drivers could also follow a hyperlink directly to the

- 4 - section in the updated Terms of Service containing the arbitration

provision. That section states in relevant part:

YOU AND LYFT MUTUALLY AGREE TO WAIVE OUR RESPECTIVE RIGHTS TO RESOLUTION OF DISPUTES IN A COURT OF LAW BY A JUDGE OR JURY AND AGREE TO RESOLVE ANY DISPUTE BY ARBITRATION, as set forth below. This agreement to arbitrate ("Arbitration Agreement") is governed by the Federal Arbitration Act . . . ANY ARBITRATION UNDER THIS AGREEMENT WILL TAKE PLACE ON AN INDIVIDUAL BASIS; CLASS ARBITRATIONS AND CLASS ACTIONS ARE NOT PERMITTED. Except as expressly provided below, this Arbitration Agreement applies to all claims (defined below) between you and Lyft, including our affiliates, subsidiaries, parents, successors, and assigns, and each of our respective officers, directors, employees, agents, or shareholders . . . . Except as expressly provided below, ALL DISPUTES AND CLAIMS BETWEEN US . . . SHALL BE EXCLUSIVELY RESOLVED BY BINDING ARBITRATION SOLELY BETWEEN YOU AND LYFT. These claims include but are not limited to any dispute, claim, or controversy, whether based on past, present, or future events, arising out of or relating to: this Agreement and prior versions thereof . . . the Lyft Platform, the Services, any other goods or services made available through the Lyft Platform, your relationship with Lyft . . . state or federal wage-hour law . . . .

Id. at 40 (alterations in original). The agreement also includes

a "Prohibition of Class Actions and Non-Individualized Relief."

Id.2 Finally, the agreement provides that "disputes regarding the

2 This prohibition reads: YOU UNDERSTAND AND AGREE THAT YOU AND LYFT MAY EACH BRING CLAIMS IN ARBITRATION AGAINST THE OTHER ONLY IN AN INDIVIDUAL CAPACITY AND NOT

- 5 - scope, applicability[,] enforceability, revocability or validity

of the Class Action Waiver may be resolved only by a civil court

of competent jurisdiction and not by an arbitrator." Id. at 40–

41.

Plaintiff Melody Cunningham has been driving for Lyft

since June 2013. Plaintiff Frunwi Mancho has been driving for

Lyft since January 2016. Both clicked the "I accept" button on

the updated Terms of Service in 2018 and neither opted out of the

arbitration agreement. Id. at 41. Both Mancho and Cunningham

used the Lyft platform to pick up passengers, some of whom were

traveling to or from Logan Airport in Boston, Massachusetts. Id.

ON A CLASS, COLLECTIVE ACTION, OR REPRESENTATIVE BASIS ("CLASS ACTION WAIVER").

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